Interview with Divej Mehta

Divej Mehta
Founder and Managing Director
Tergus Works Pvt Ltd

Expecting 35-40% drop in business this season

Around two years back leather businessman Divej Mehta, founder and managing director of Mumbai-based Tergus Works Pvt Ltd (TWPL), introduced a footwear brand called 'Inmate', with chappals exclusively made by prisoners of the Yerwada prison in Pune. Started in 2017, TWPL is involved in tanning and dressing of leather, manufacture of luggage handbags, saddlery and harness. Mehta spoke to Fibre2Fashion about the fallout of the COVID-19 crisis.

In which specific areas are you facing major issues?

More than just the cancelled orders, the major issues are the unprecedented closure of major season sales, stocks piled up at warehouses or store locations along with 400 of our imprisoned workforce with no income that they send to their dependent families. About 5,000 people, who receive indirect support from our business, have suddenly become helpless. All of these and much more becomes a worry for us at Inmate.

What steps are you taking or have taken to face the challenges like order cancellation your have cited above?

We started with analysing the situation thoroughly with joint online team meetings. For any problem to be solved, it is of primal importance to gauge the depth and adversity of it. We also got in touch with a few experts from different fields to try understanding the overall impact of COVID-19 and how best could we overcome the adversities.

For instance, we came up with a campaign in which all proceeds generated through online sales will be donated. The product purchased by the customer will be delivered once the lockdown is over, but the money will be used to help and aid the needy. This exercise not only allows us to fulfil our duty as an able company but also spreads the message of being active during a crisis like this.

Further, our sales during this period ensure a bit of work so that we can immediately start processing upon resuming work.

How critical would be the anticipated loss or reduction of trained manpower on fronts like manufacturing, warehousing, supply chain etc. for your business?

As a company, we are still in our early days as a brand (Inmate) and as a white label job-worker. We focused our efforts majorly on setting our roots right and making a backend that can sustain difficult times. Our model has always been to focus on our strengths. At an unprecedented time like this, our mindset of having stock only for orders in hand has allowed us some serious relief; that is one less problem for us to solve and allows us to have that much free capital for future developments.

We have always worked on creating models and strategies that best serve our needs and not believed in following any strategy set as per industry standards and that has proved to be beneficial. We are not looking at any major losses even at a time like this, other than anticipated season sale loss or lesser income due to the lockdown.

Have you quantified your projected losses, the basic anticipated work loss, etc?

Definitely, we have projected lower numbers that will not only affect one season, but it will have a major impact on the entire working of the industry, be it restarting or strategising our next steps as we move into a phase of rebuilding. We are looking at a 35-40 per cent drop in business this season and at least an accumulated loss of 20 per cent for the rest of the year.

Are there any thoughts within individual members, trade associations to come together and work cohesively so that losses can be minimised?

We have been talking to a few members of the textile council and prison authorities to work together with state governments to collaborate and manufacture khadi face masks. Many prisons across the country have been manufacturing masks, a product that is going to have more value as time passes. This also allows us to have continued work and will help in reducing financial stress.

We are looking at manufacturing other hygiene essentials like soap and sanitation liquids for state governments and government bodies.

We have also been closely working with investors groups, most of whom have set up collective funds to facilitate purchase orders and working capital requirements for micro, small and medium enterprises and start-ups.

By when are you expecting the revival process to commence?

Honestly, there is no time like today. It is important to strategise each move to be absolutely sure of what you will be doing when the actual revival process brings. It is imperative to minimise the mistakes you make whenever the process starts and according to me, the best way is to collaborate with known partners, make use of government schemes and look to start small rather than have a very dynamic re-entry, as this will be a long and painful process of rebuilding if we are not careful.

Is your business entity expecting any specific measure from the government or its nodal departments?

At a time like this, it is very important for each business owner to understand and live with the fact that it is every individual to him or herself. Government bodies will have their hands full with resolving the crisis first, and will look at economic development much later. While most departments might not have the full authority to aid everyone in need, it is necessary to strategise without expectation of aid from the government for a few months. So I would say a self-sustaining strategy will be the way ahead.

There is a lot of talk about rewiring businesses to arrive at the new normal. Any thought process towards this at the company level or collectively as an industry?

History shows every country or industry has recovered from any crisis with collective efforts. We should learn from the mistakes we have made, we have been relying for so many things on different countries, be it raw materials, designing, trends or purchase orders. China has been dominating, Bangladesh and Vietnam have grown considerably in their exports and have become known even to produce quality goods. India is rich in raw material sources, manpower and intellectual wellness. We must have a self-sustaining model, and I would definitely urge fellow businessmen, industrialists, colleagues, traders, manufacturers and the government to promote Indian goods. We have one of the largest manufacturing bases and a population that can consume a lot. On an industry level, India is the third largest footwear consumer in the world, producing close to 2 billion pairs of all footwear combined. We also have the industrial knowhow, domestic brands and the raw material for finished goods.

A whole lot of enterprises have begun manufacturing of masks and other personal protective equipment (PPE) required in bulk today. Has any such step been taken by anyone in your sector? Is the industry or cluster mulling over any such initiative?

We are closely working with the textile industry, state government bodies and associations to build a steady supply chain of all essential items including khadi face mask, hand sanitiser, soaps and even textile-based PPE for frontline workers healthcare.

Every state has issued requirement lists and is helping manufacturers in setting up supply chains to produce and supply the products without difficulty.

Published on: 07/05/2020

DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.